GSK has "stopped the bleeding" from Avandia decline – Garnier

Generic competition and a major drop in sales of its diabetes drug Avandia has led to GlaxoSmithKline posting a 9% decline in operating profits to £2.05 billion for the first quarter.

Turnover slipped 3% to £5.67 billion, with pharmaceutical sales decreasing 4% to £4.80 million. The most significant decline was a 56% drop in revenues, to £191 million, for Avandia (rosiglitazone) which has suffered ever since a meta-analysis that was published last May by the New England Journal of Medicine alleged a link between the drug and the risk of cardiovascular disease, claims which have not died away.

Chief executive Jean-Pierre Garnier acknowledged on a conference call that the product “lost many users last year” but in the last six to eight weeks “we have seen stability in the number of prescriptions written for Avandia”. He went on to say that it is too early to say whether “we're going to be able to turn around the Avandia franchise and recoup the patients we lost" but claimed that "so far at least we have stopped the bleeding”.

Other drugs were savaged by generic competition, notably Zofran (ondansetron), GSK’s nausea treatment for patients undergoing chemotherapy for cancer, which fell 69% to £29 million, the allergy drug Flixonase/Flonase (fluticasone), down 33% to £46 million and the antidepressant Wellbutrin (bupropion), which slipped 3% to £126 million. Sales of the heart disease drug Coreg (carvedilol) sank 77% to £48 million.

It was not all doom and gloom, however, and Advair/Seretide (salmeterol and fluticasone) for asthma and chronic obstructive pulmonary disease grew 10% to £954 million. GSK's vaccine sales climbed 10% to £436 million, and were up 34% in the USA to £109 million, driven by hepatitis jabs and Infanrix/Pediarix. Sales of Lamictal (lamotrigine) for epilepsy were up 16% to £290 million, while Valtrex (valaciclovir) for herpes infections also performed well with a 9% rise in turnover to £249 million. ReQuip (pramipexole), for Parkinson’s disease and restless legs syndrome (RLS), grew 15% to £94 million.

Dr Garnier also responded to the accusation that GSK is paying well over the odds, $720 million, to acquire Sirtris Pharmaceuticals of the USA. He said that the premium is a reasonable one, given the “really innovative research” Sirtris is doing in terms of sirtuins, a class of enzymes that control the aging process. He also noted that not “all M&A at GSK is for the long-term but this one is”.

A more pressing problem was the announcement yesterday that France’s regulators have not recommended reimbursement for GSK’s cervical cancer vaccine Cervarix. Dr Garnier said it is not that the French authorities “don't like the product, but they want to see more evidence of Cervarix's superiority over [Merck & Co’s] Gardasil”.

The CEO concluded by noting that a final decision on approval for the breast cancer therapy Tyverb (lapatinib) in Europe could be known in the next week or two.